SALESFORCE INC (CRM)
US79466L3024 - Common Stock
Taking everything into account, CRM scores 7 out of 10 in our fundamental rating. CRM was compared to 284 industry peers in the Software industry. CRM scores excellent points on both the profitability and health parts. This is a solid base for a good stock. CRM is not priced too expensively while it is growing strongly. Keep and eye on this one! With these ratings, CRM could be worth investigating further for growth and quality investing!.
1. Profitability
1.1 Basic Checks
CRM had positive earnings in the past year.
CRM had a positive operating cash flow in the past year.
Each year in the past 5 years CRM has been profitable.
In the past 5 years CRM always reported a positive cash flow from operatings.
1.2 Ratios
CRM has a Return On Assets of 6.11%. This is amongst the best in the industry. CRM outperforms 81.27% of its industry peers.
CRM has a Return On Equity of 9.77%. This is amongst the best in the industry. CRM outperforms 80.92% of its industry peers.
CRM has a Return On Invested Capital of 7.71%. This is amongst the best in the industry. CRM outperforms 81.98% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CRM is significantly below the industry average of 10.33%.
The 3 year average ROIC (3.04%) for CRM is below the current ROIC(7.71%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.11% | ||
| ROE | 9.77% | ||
| ROIC | 7.71% |
ROA(3y)1.96%
ROA(5y)2.45%
ROE(3y)3.26%
ROE(5y)3.99%
ROIC(3y)3.04%
ROIC(5y)2.16%
1.3 Margins
CRM's Profit Margin of 15.44% is amongst the best of the industry. CRM outperforms 83.39% of its industry peers.
In the last couple of years the Profit Margin of CRM has grown nicely.
Looking at the Operating Margin, with a value of 19.06%, CRM belongs to the top of the industry, outperforming 88.34% of the companies in the same industry.
CRM's Operating Margin has improved in the last couple of years.
CRM has a better Gross Margin (76.35%) than 71.73% of its industry peers.
In the last couple of years the Gross Margin of CRM has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.06% | ||
| PM (TTM) | 15.44% | ||
| GM | 76.35% |
OM growth 3Y100.32%
OM growth 5Y32.39%
PM growth 3Y-14.76%
PM growth 5Y7.26%
GM growth 3Y0.48%
GM growth 5Y0.4%
2. Health
2.1 Basic Checks
CRM has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, CRM has less shares outstanding
The number of shares outstanding for CRM has been increased compared to 5 years ago.
Compared to 1 year ago, CRM has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.95 indicates that CRM is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.95, CRM is in the better half of the industry, outperforming 67.49% of the companies in the same industry.
The Debt to FCF ratio of CRM is 0.74, which is an excellent value as it means it would take CRM, only 0.74 years of fcf income to pay off all of its debts.
CRM has a Debt to FCF ratio of 0.74. This is in the better half of the industry: CRM outperforms 75.27% of its industry peers.
A Debt/Equity ratio of 0.15 indicates that CRM is not too dependend on debt financing.
CRM has a Debt to Equity ratio (0.15) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | 0.74 | ||
| Altman-Z | 4.95 |
ROIC/WACC0.83
WACC9.25%
2.3 Liquidity
A Current Ratio of 1.04 indicates that CRM should not have too much problems paying its short term obligations.
With a Current ratio value of 1.04, CRM is not doing good in the industry: 74.91% of the companies in the same industry are doing better.
CRM has a Quick Ratio of 1.04. This is a normal value and indicates that CRM is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of CRM (1.04) is worse than 74.20% of its industry peers.
CRM does not score too well on the current and quick ratio evaluation. However, as it has excellent solvency and profitability, these ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.04 | ||
| Quick Ratio | 1.04 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 36.43% over the past year.
Measured over the past years, CRM shows a very strong growth in Earnings Per Share. The EPS has been growing by 26.05% on average per year.
CRM shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 10.26%.
The Revenue has been growing by 21.28% on average over the past years. This is a very strong growth!
EPS 1Y (TTM)36.43%
EPS 3Y18.61%
EPS 5Y26.05%
EPS Q2Q%20.75%
Revenue 1Y (TTM)10.26%
Revenue growth 3Y17.93%
Revenue growth 5Y21.28%
Sales Q2Q%8.39%
3.2 Future
CRM is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 14.63% yearly.
Based on estimates for the next years, CRM will show a quite strong growth in Revenue. The Revenue will grow by 10.16% on average per year.
EPS Next Y24.29%
EPS Next 2Y16.99%
EPS Next 3Y15.98%
EPS Next 5Y14.63%
Revenue Next Year8.79%
Revenue Next 2Y8.83%
Revenue Next 3Y9.06%
Revenue Next 5Y10.16%
3.3 Evolution
The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
The estimated forward Revenue growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
4. Valuation
4.1 Price/Earnings Ratio
CRM is valuated quite expensively with a Price/Earnings ratio of 25.95.
Based on the Price/Earnings ratio, CRM is valued a bit cheaper than the industry average as 74.91% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 29.62, CRM is valued at the same level.
CRM is valuated rather expensively with a Price/Forward Earnings ratio of 21.71.
CRM's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. CRM is cheaper than 73.85% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.22, CRM is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.95 | ||
| Fwd PE | 21.71 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, CRM is valued a bit cheaper than 78.80% of the companies in the same industry.
83.39% of the companies in the same industry are more expensive than CRM, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.35 | ||
| EV/EBITDA | 21.43 |
4.3 Compensation for Growth
CRM's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
CRM has an outstanding profitability rating, which may justify a higher PE ratio.
A more expensive valuation may be justified as CRM's earnings are expected to grow with 15.98% in the coming years.
PEG (NY)1.07
PEG (5Y)1
EPS Next 2Y16.99%
EPS Next 3Y15.98%
5. Dividend
5.1 Amount
CRM has a yearly dividend return of 0.65%, which is pretty low.
CRM's Dividend Yield is rather good when compared to the industry average which is at 12.13. CRM pays more dividend than 91.87% of the companies in the same industry.
With a Dividend Yield of 0.65, CRM pays less dividend than the S&P500 average, which is at 2.24.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.65% |
5.2 History
CRM does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y16.99%
EPS Next 3Y15.98%
SALESFORCE INC
NYSE:CRM (9/6/2024, 8:06:45 PM)
After market: 243 -0.97 (-0.4%)243.97
-2.15 (-0.87%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupSoftware & Services
GICS IndustrySoftware
Earnings (Last)
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Inst Owners
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Market Cap233.24B
Analysts
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Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.65% |
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 25.95 | ||
| Fwd PE | 21.71 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
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PEG (NY)1.07
PEG (5Y)1
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.11% | ||
| ROE | 9.77% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 19.06% | ||
| PM (TTM) | 15.44% | ||
| GM | 76.35% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
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ROICexcg growth 5Y
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F-Score
Asset Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.15 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.04 | ||
| Quick Ratio | 1.04 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)36.43%
EPS 3Y18.61%
EPS 5Y
EPS Q2Q%
EPS Next Y24.29%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)10.26%
Revenue growth 3Y17.93%
Revenue growth 5Y
Sales Q2Q%
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Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
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